SOLUTION: Find the final amount of the investment. $10,000 invested at 6% compounded quarterly for 5 1/2 years. (end of problem) I've put this in my TI-83 calculator 20 times... and it s

Algebra ->  Customizable Word Problem Solvers  -> Finance -> SOLUTION: Find the final amount of the investment. $10,000 invested at 6% compounded quarterly for 5 1/2 years. (end of problem) I've put this in my TI-83 calculator 20 times... and it s      Log On

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Question 38631: Find the final amount of the investment. $10,000 invested at 6% compounded quarterly for 5 1/2 years. (end of problem)
I've put this in my TI-83 calculator 20 times... and it still comes out 58,374.99. What am I doing wrong?
I know the formula is A=P(1+r/t)^rt
Can you help?
Found 2 solutions by rapaljer, Earlsdon:
Answer by rapaljer(4671) About Me  (Show Source):
You can put this solution on YOUR website!
Did you take the 6% and divide by 4 giving you 1.5% or .015 per period?

Did you take 5 1/2 years and multiply times 4 giving you 22 periods of compounding?

If you do those two items, the rest should work out. I am getting this:
A+=+10000%281%2B+.015%29%5E22
A=+13875.64

R^2 at SCC

Answer by Earlsdon(6294) About Me  (Show Source):
You can put this solution on YOUR website!
The formula for interest compounded q times per year is:
P+=+A%281%2Bi%2Fq%29%5Enq
Where: P = Present value.
A = The amount invested ($10,000.00)
i = The rate of interest, as a decimal (0.06)
q = The number of compounding periods (4)
n = The number of years invested (5.5)
Substituting the above into the formula:
P+=+10000%281%2B0.06%2F4%29%5E%285.5%2A4%29
P+=+10000%281.015%29%5E22
P+=+13875.66
The final amount is:
$13,875.66